The British Retail Consortium (BRC) has called on the Government and the police to take e-crime more seriously as a new report suggests it is the largest emerging threat to the retail sector.
The BRC’s first e-crime study estimates the total cost to retailers in 2011/12 was at least £205.4m. About £77.3m comprised of losses from frauds themselves as well as prevention costs and legitimate business lost as a result of those measures.
E-crime represents 0.75% of the £28bn of online retail sales in 2011. This is double the proportion of retail crime across all retail, which at £1.4bn makes up 0.36% of the £303bn of total retail sales.
The UK is acknowledged as a world leader in online retailing with the biggest internet spend per capita of any nation, therefore the BRC believes action must be taken.
But of those surveyed, 60% of retailers said it was unlikely they would report more than 10% of e-crimes to police, demonstrating their lack of confidence in the official response to e-crime.
BRC director general Stephen Robertson said: “Law enforcement and the Government need to work with us to develop a consistent, centralised method for reporting and investigating e-crime and resources must be directed to e-crime in line with the emerging threat.
“This will encourage retailers to report more offences and allow the police to better identify and combat new threats.”
The most expensive type of e-crime for retailers was personal identification-related frauds, which made up losses of £20m in 2011/12. Card fraud made up £15m losses, while refund frauds were responsible for £1.2m in losses.
Conversely, retailers that used additional security measures to prevent e-crime lost £111.6m of business as customers were put off buying from them.